Telstra bill faces crowded, difficult road

The federal government’s plans for a national broadband network could face delays if it does not secure the passage of key legislation that allows
Telstra
to separate its retail and wholesale arms in the next fortnight.

Labor’s reform credentials face a serious test when Parliament resumes today, as key reforms on the structural separation of Telstra, political donations, shareholder entitlements and health funding crowd the list of business before Parliament rises at the end of next week for a lengthy summer break.

And the reform agenda faces derailment by a political debate likely to focus on a wide range of other issues, driven by the opposition and the Greens, including bank regulation, asylum seeker processing, gay marriage and the development of the Wild Rivers region in Cape York.

Labor seems confident of securing enough votes from the independents and Greens to get its so-called telecommunications competition and consumer safeguards bill – which will allow the structural separation of Telstra’s retail and wholesale arms – through the House of Representatives.

But its position in the Senate is less clear, despite indications from independent senator
Steve Fielding
that he might support the bill.

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The Communications Minister, Stephen Conroy, will be under pressure to release the business case for the $43 billion national broadband network, which he received last week. But this appears unlikely to happen before Parliament rises, as there is ­little time to censor commercial-in-confidence material in the 400-plus-page document and obtain cabinet approval of its release.

The opposition demands a more thorough examination of the costs and competition implications of the NBN, which was highlighted yesterday by the Organisation for Economic Co-operation and Development as a major risk factor in Australia’s otherwise rosy economic outlook.

Opposition communications spokesman
Malcolm Turnbull
has significantly scaled back the Coalition’s complaints about the structural separation of Telstra. But he has proposed four amendments to the bill that would result in greater scrutiny by the Australian Competition and Consumer Commission of the deal between NBN Co and Telstra, and would ensure protections against coercion of Telstra by the ­government. Telstra backs the bill but Optus has raised concerns that there is insufficient oversight of Telstra’s structural separation undertaking.

The government warned that Telstra would not be able to seek approval from shareholders and development of the NBN would not be able to use Telstra’s pits, ducts and other infrastructure until the bill passes.

“This legislation is crucial to ensuring the agreement between NBN Co and Telstra can be finalised," Senator Conroy’s spokeswoman said.

“Every day of delay is another day of higher prices, less choice and fewer innovative services for consumers and small businesses."

Labor also hopes to pass three major reform bills through the Senate on preventative health, medicine ­pricing and health-care safety and quality standards.

Proposed changes to ­federal funding of the health system will come up for debate in the House of Representatives next week.

In addition, the government will attempt to push through lower disclosure limits for political donations and changes to the corporations law to reverse the effect of the High Court’s decision in the Sons of Gwalia case, which placed shareholders on an equal basis with creditors in a failed company.